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Advance & Co. owns vast amounts of corporate bonds. Suppose Advance buys Requirements $1,100,000 of FermaCo bonds at face value on January 2, 2018. The
Advance & Co. owns vast amounts of corporate bonds. Suppose Advance buys Requirements $1,100,000 of FermaCo bonds at face value on January 2, 2018. The FermaCo1. Joumalize any required 2018 entries for the bond investment. bonds pay interest at the annual rate of 3% on June 30 and December 31 and mature on December 31, 2037. Advance intends to hold the investment until maturity. 2. How much cash interest will Advance receive each year from FermaCo? 3. How much interest revenue will Advance report during 2018 on this bond investment? Requirement 1. Journalize any required 2018 entries for the bond investment. (Record debits first, then credits. Select the explanation on the last line of the journal entry table.) Begin by journalizing Advance's investment on January 2, 2018 Accounts and Explanation Debit Credit Date 2018 Jan. 2 Next, journalize the receipt of cash interest on June 30, 2018. Accounts and Explanation Debit Credit Date 2018 Jun. 30 Now journalize the receipt of cash interest on December 31, 2018. Accounts and Explanation Debit Credit Date 2018 Dec. 31 Requirement 2. How much cash interest will Advance receive each year from FermaCo? Advance will receivesof cash interest each year from FermaCo. Requirement 3. How much interest revenue will Advance report during 2018 on this bond investment? of cash interest each year from FermaCo dvance willeot of interest revenue during 2018 on this bond investment
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